I almost missed it. In the darkness, illuminated in a flash of headlights, a big, black swastika shone out from the side of a concrete bridge. We were driving across southern Italy at night and the only lights came from the angry, wriggling lines of fires set by farmers to burn stubble off the fields.

Europe’s politicians have yet to realise how remote from the people they really are.

In this remote, impoverished region, he is facing an uphill battle. The Nazi graffiti is just one sign of the extreme cynicism and anti-government feeling that saw a huge regional swing to the Five Star Movement, a populist party run by comedian Beppe Grillo, in 2013.

Protesters chant slogans during an anti-fascist rally in Athens, on Saturday, May 14, 2016.Credit:
Yorgos Karahalis

The referendum result will have a knock-on effect across the EU. Italy, bearing a debt burden similar levels to that of Greece in 2009 and with an economy that hasn’t grown strongly since 2000, has become a focus for market worries about the health of the Eurozone. The market fallout from Brexit, negligible so far in the UK, pushed Rome into a E50 billion bailout for its banks.

Mr Renzi’s referendum is the first electoral test of an EU government since Brexit. He argues that the constitutional changes would allow him to get on with economic reforms. Brussels, despite clashing with Italy over austerity, is hoping for a “yes” that would deliver a much-needed confidence boost. A “no” could set off a fresh round of market turbulence and signal, yet again, that the Eurozone’s politics are hindering recovery at every turn.

On the face of it, Matera should be a success story for Europe. Just seventy years ago, over 20,000 peasants lived here in ancient caves, plagued by malnutrition, trachoma and malaria.

The peasants were moved out after the war and for decades, the caves lay empty. Then, spurred by a flood of EU grants and from Mel Gibson’s decision to film The Passion of the Christ here, they started to become a tourist attraction. Now, the picturesque town, spread along the top of a deep, dusty gorge, is touted as a “hidden gem” in travel guides and Eurocrats have deigned to award it Capital of Culture status for 2019.

Look beyond the wide-angle cityscapes, however, and decay isn’t hard to find. On an average weekday, young men wile away the hours sipping beers in the plazas. For every beautifully refurbished grotto, dozens still lie empty, like a strange, reverse-Pompei where restoration work suddenly stopped.

Nazi graffiti is just one sign of the extreme cynicism and anti-government feeling that saw a huge regional swing to the Five Star Movement, a populist party run by comedian Beppe Grillo, in 2013.

On paper, the figures tell a bleak story. In the region of Basilicata, where Matera is situated, more than half of the population is “economically inactive”. The economy declined by 12.8 per cent between 2007 and 2014. Even in the 2000-2007 period, while most of Europe was booming, growth receded by 0.5 per cent.

Mr Renzi, an anti-austerity left-winger installed as Prime Minister in 2014, has promised change. His slick presentation boosted confidence initially and Italy moved from recession to sluggish growth, but progress has stalled.

In this photo taken on Wednesday, March 16, 2016 migrants on a dinghy boat are rescued by Italian Navy's personnel off the coast of Lampedusa island, Italy.Credit:
Marina Militare via AP Photo

He spent the spring unveiling flashy new initiatives to boost southern Italy’s struggling economy. But when he ventures south of Rome, his visits are greeted by protests. The Mayor of Naples, a popular independent politician, has accused him of “trampling” Italy’s constitution.

Like northern England, southern Italy has seen politicians’ promises of change come and go. In 1936, the anti-fascist writer Carlo Levi spent a year among the peasants of Basilicata. On returning to the north, he realised all of its politicians, fascist, left-wing and liberal, were irrelevant. “Their solutions were abstract and far removed from reality; they were schematic halfway measures,” he wrote. To the peasants, all of it was “monolithic, centralised and remote”.

Europe’s politicians have yet to realise how remote from the people they really are. For years, they have believed that the arc of history is drawing us all together into a grandiose internationalist project. Voters, just the like peasants before them, take one look at it all and shrug. Mr Renzi has gambled that his engaging personality is enough to overcome a deep cynicism and sense of detachment going back hundreds of years. The Europhiles are hoping he’s right.